Hays: Recruiter warns on profit amid slowdown in permanent hires
Recruiter Hays reported another fall in quarterly fees on Wednesday amid an ongoing slowdown in the headhunting market.
Group net fees, which are considered an indicator of performance in the industry, dropped 12 per cent in the three months ending 31 December.
The downturn was driven by a significant drop-off in permanent hires, down 19 per cent alongside a seven per cent decline in Temp fees.
Still, the firm anticipates it will meet half-year operating profit targets of between £24m and £33m, warning it would be at the lower end.
“We are structurally improving Hays despite challenging markets and remain resolutely focused on driving operational rigour through business line prioritisation, resource allocation, and efficiency initiatives,” Dirk Hahn, chief executive, said.
Hahn added it was “too early” to say if recent weakness in Perm reflected a “more sustained market slowdown or shorter-term deferrals of client and candidate decision making.”
Yet another dip in fees at Hays comes amid a long-running crisis in the recruitment market. Cost-cutting in industries including tech and a reluctance from candidates to move jobs has pummelled some of London’s biggest recruiters.
FTSE 250-listed Hays reported a 90 per cent decline in full-year profit in August as it warned UK employers were hesitant to hire staff following Labour’s election win.
Shares have fallen around 10 per cent this year to date.
Hahn said: “We are delivering on our strategy to focus on long-term growth markets and build a structurally more profitable and resilient business underpinned by our culture and talented colleagues worldwide so I remain confident that we will benefit materially when our end markets recover.”